Learn from Toyota…the good and the bad

I’ve been thinking about this post for some time. I’m a Toyota customer. Our family has owned four Toyota Corolla’s over the past twenty years and we’ve always been very happy with them. Our most recent purchase, a 2010 Corolla S, has been a great car for my daily 160 Km (100 mile) commute. With a fuel mileage of 5.6 litres per 100 km (35 mpg) on the highway, I’m not cursing the oil companies with the vehemence I once did. On the other hand, this is the first time I can recall in all the years that we’ve owned Toyotas that I’ve had to deal with a recall. And so far, I’ve had two (brakes, accelerator pedal)…with a possible third (power steering?) rumoured to be in the works.

The Toyota quality problems have disappointed me. I learned about the Toyota production system when I was studying Industrial Engineering in college. At that time, it was held up as the future in manufacturing – a model that other manufacturers around the world should follow. It still is. At Toyota, defects are considered to be MUDA (waste) when they occur, the root cause is found and eliminated. This is the cornerstone of their system. Since then, my studies in lean manufacturing have taken me deeper into the Toyota manufacturing system and my faith in the quality of their products has only improved.

I expect better from Toyota…and I suspect Toyota feels the same way.

Toyota has made mistakes: first the error that caused the problem in the first place, then the shoddy handling of the first incidents (which could be the result of disbelief that the problem could be caused by a manufacturing defect). They seem pretty confident now that they have the problem figured out. Let’s hope so.

What got me thinking is this… Here is this vaunted company, renowned for the fine quality of its products, with systems specifically designed to prevent quality problems from happening and especially from getting out of the factory. Yet, this company is running into some serious quality problems.

Think about Toyota and their processes. Think about your company and your processes. Which company do you think would be less likely to run into this type of problem? What processes do you have in place to ensure that this doesn’t happen? Here’s something more interesting. On February 1st, Toyota announced that they had figured out the gas pedal problem. On February 11th, I had my car in for an oil change and they told me they had the kit to fix the accelerator pedal so they would do that while my car was in. Toyota had the parts to address the sticking pedal recall days after announcing the fix. How long would it take your company to respond?

I’m not trying defend Toyota. Like I said, they made mistakes – and it’s costing them. What I’m trying to do is to have us learn from what Toyota has done wrong, and from what Toyota has done right. Who knows… The next time it might be your company facing a problem of this magnitude. Will you have the capabilities in place to respond?

About the Author

John Westerveld is a demo architect for Kinaxis. Previously, John was a product manager responsible for supply management , supply chain risk management, application interface and framework, integration management and server. He joined Kinaxis over 7 years ago bringing with him 16 years of manufacturing experience, including 10 years in the information technology field. John is a qualified APICS instructor and is certified APICS CPIM.

Discussions

Toyota & Honda dropped the ball on handling the recalls , they should have came forward with a full disclosure. Instead of waiting for a huge media blitz and tons of public pressure. But Toyota & Honda are not alone , I never seen so many car companies having recalls all at the same time. I had no idea my car which is not even a Toyota or Honda, was affected until I searched on http://www.carpedalrecall.com and found I had a bad Anti Lock control unit on my 2008 Pontiac G8 , So be careful check daily, it seems more and more cars are being recalled .

My first suggestion is that we may be premature in condemning Toyota’s quality system, specifically when segregating it from Toyota’s engineering system, supply chain system or manufacturing system. As of today there are many experts in academia who are suggesting that Toyota’s problems are not caused by sticking pedals or floor mats and that the real problem runs much deeper in electrical systems. I think we have to wait and see what really boils out in the end. Maybe all these dealers are fixing the wrong root cause in an effort to buy time, we don’t really know. Additionally as in many companies good quality is as the print or specification says, i.e. if engineering says a part or system should look and perform in a specific fashion, it fits with it’s mating parts and works as prescribed on the assembly line, it is considered acceptable quality, hence this whole scenario more than likely and splitting hairs is a (quality of engineering design) issue not a quality of part or supply chain issue in the truest sense.

I would also suggest that it comes down to the magnitude of the fix as far as how easy it is for a company to manage the chain of events required to affect the fix. It is fairly easy to come up with and distribute 8 million minor shims etc. to fix a problem, it’s quite another to redesign a whole new ECM, get prototypes, do long term testing and build and distribute 8 million of those to dealers.

I don’t think we have heard the end of this story yet; we need to get there before we can suggest which system failed at Toyota and whether the fix was done in an efficient fashion.

Hi John,
I had the same teaching as yours at colledge, and now I teach myself these principles in my Inventory Management and Supply Chain Management classes. I really need to understand, what went wrong with the Toyota Production System. Is it the fact of lowering expenses as much as possible that finally drove the quality down? I would be very interested by the testimony of a Toyota person on that aspect.
Thanks in advance!

Do you think Toyota will do good with the congressional hearings? These recalls are killing them. Seen the stock after the recalls? Also people like http://www.americanjobadvocate.com are not doing them any good

The issues that have hit Toyota have undoubtedly caused much embarrassment if not pain at the very top of the company. Even more disturbing rumors circulate that defects were known internally in the company prior to the public media disclosures.

Toyota has become the role model for efficiency under the title of “Lean”, besides which the reliability of it products enjoy legendary reognition. All of which leaves one supposing that corrective measures have been implemented. However the nub of the issue lies in the challenge of what to do when there are defective products in the market.
When safety is an issue there is the clearly an urgency, irrespective of cost or reputation.
What this sad event highlights is the need for all manufacturers to review their containment process.

We are spoiled! Toyota produces great vehicles and they do their best to address any defect in their vehicle. Not one car manufacturer can claim perfection. They need to work better with the dealer who distributed their cars and let those same dealers keep their ears to the ground.

Safety of course is important, we are sadly living in continuing “me” first world.